Empirical results for the euro area show that an important channel through which monetary policy – measured traditionally by the short-term interest rate as well as by the Eurosystem balance sheet total – affects economic growth is the confidence of borrowers as well as of lenders. Impulse...

An epidemiologist calculating the risk of a localised epidemic becoming a global pandemic would investigate every possible channel of contagion from the infected region to the rest of the world. Focusing on, say, the incidence of close human contact would underestimate the pandemic risk if the...

Over the past few years the CDS market's role has evolved from mostly providing default protection towards credit risk trading. The first-ever credit event in a developed country's sovereign CDS has further highlighted the importance of the CDS market from a macro-prudential perspective....